If you’re tired of earning less than 1 percent interest on money languishing in your savings accounts but desire an alternative to the usual stocks and mutual funds, you may want to consider investing in commercial real estate. According to RealtyMogul, an online real estate investing marketplace, real estate has outperformed the stock market nearly two to one for 15 years—even in robust bull markets like the one we enjoy today.
RewardExpert recently spoke with Jilliene Helman, CEO and co-founder of RealtyMogul, about the marketplace’s history, REIT product offerings, and why you may want to add commercial real estate investment to your portfolio.
More than $300 Million in Real Estate Investments
Launched in 2013 and headquartered in Los Angeles, California, Helman co-founded RealtyMogul with Justin Hughes, the company’s chief product architect, after serving as a vice president at Union Bank.
“From my experience working at Union Bank in wealth management, I knew that many of the firm’s wealthiest clients were using real estate as a means of building wealth,” Helman explained. “I come from a family of entrepreneurs and always knew I wanted to be a CEO, so when the JOBS Act passed, I made the decision to start RealtyMogul.”
Since its founding, the company has expanded quickly, opening regional offices in Houston, Atlanta, San Francisco, San Diego, New York and Salt Lake City. To date, investors have invested over $300 million through RealtyMogul’s marketplace, financing more than 350 properties valued at over $1 billion.
Participate in Large-Scale Real Estate Transactions
To satisfy its mission to provide exclusive access to thoroughly vetted real estate opportunities, RealtyMogul offers two REITs—or real estate investment trusts—in which accredited, non-accredited, and institutional investors may invest. Put simply, a REIT is a company that owns or finances real estate.
REITs give their investors the opportunity to participate in large-scale real estate transactions by purchasing shares of the company that owns or finances them. This puts the benefits of real estate investment within reach of even those with minimal capital to invest.
A registered, public, non-traded REIT that invests in multi-family, office, industrial, self-storage, and retail real estate opportunities as well as commercial real estate-related equity and debt assets across these property types. Designed for income diversification, MogulREIT is open to both accredited and non-accredited investors.
“Beyond the zero commissions and lower fees, the fund’s strategy is exciting because it allows us to leverage RealtyMogul’s hundreds of inbound inquiries for financing on commercial real estate and curate them to find suitable opportunities,” Helman said. Investors in MogulREIT I must purchase 1,000 common shares or invest $10,000 based on the current share price.
“Through a flexible investment strategy, we can invest in both debt and equity as well as various property types and geographies, allowing us to be opportunistic,” Helman continued. “We aim to continue executing against our two-fold objective for the fund: providing investors with both consistent cash distributions and the opportunity to benefit from potential appreciation in property values.”
A registered, non-traded REIT that invests in multifamily apartment buildings throughout the United States. Investors in MogulREIT II must invest a minimum of $5,000.
“Multifamily continues to be a great sector for investment, as people of all ages are choosing to rent rather than buy a home,” Helman said. “The massive Millennial generation is the largest share of the American workforce and highly values rentals, which satisfy their desire to maintain a flexible lifestyle. We’re even seeing an emerging demand among Baby Boomers, who are moving back into city centers from their homes in the suburbs.”
200 Years of Investment Experience
If you want to diversify your portfolio and have at least $5,000 to invest, RealtyMogul’s REITs may be a good option for you.
“RealtyMogul investors are typically individuals who are seeking to diversify their portfolios with investments in alternative asset classes,” Helman said. “They have different levels of experience and knowledge of commercial real estate investing, but generally understand its objective to provide income and value through appreciation.”
While investments in RealtyMogul’s REITs are illiquid and loss of invested capital is possible, the company’s strategy was carefully designed to minimize risk.
“RealtyMogul is unique in its approach to assessing risk via its zero-based underwriting strategy, which analyzes each potential deal from scratch through a combination of proprietary in-house analytics and underwriting,” Helman noted. “RealtyMogul also spends over $1 million annually for the use of third-party data and technology to vet each deal, which is reviewed by its experienced staff of commercial real estate professionals who have a combined 200 years of experience.”
To learn more about the benefits commercial real estate investment offers, how RealtyMogul REITs work, and more, visit www.realtymogul.com.